Wednesday 20 February 2013 02.01 EST
First published on Wednesday 20 February 2013 02.01 EST

How politically important is Rupert Murdoch? After more than half a century of his manoeuvrings, carefully and tellingly itemised in this book, it may seem naive even to ask the question. Only last month, to the alarm and perhaps hidden satisfaction of Murdoch-watchers, the supposedly infinitely manipulative magnate held dinners on successive nights at his London home in Mayfair, attended by Boris Johnson, George Osborne, William Hague and Michael Gove – the full set of pretenders, declared and otherwise, to David Cameron's unstable Tory throne.

Yet recent events have undermined the conventional wisdom that Murdoch is omnipotent. Last year there was his cheerleading for Mitt Romney – "looking better and better while Obama seems devoid of anything new", Murdoch tweeted 11 days before Obama comfortably won re-election. In 2011 there was Murdoch's unprecedented televised calling to account over the phone-hacking scandal by a committee of mere MPs. This autumn, there are the scheduled phone-hacking trials – probably the first of many – of Murdoch's once-vital British lieutenants and political liaisons, Rebekah Brooks and Andy Coulson. And then there is the ongoing, less sensational but more significant, unravelling of faith in the free market – a faith fiercely held by Murdoch and relentlessly spread from his media citadels for 40 years – since the financial crisis began in 2007.

Murdoch turns 82 next month. His mother, Elisabeth, died last December at the age of 103. "So far there is no sign of Rupert Murdoch genuinely stepping aside" from his intertwined political and business activities, McKnight writes. But this book, despite its subtitle, is more about Murdoch's past than his present. It wants to be a polemic but sometimes reads more like an obituary.

The main arc of the story begins in Australia in the 1950s. McKnight has already sketched Murdoch's early biography: a wealthy, influential father with anglophile tastes; an ambitious, frustrated stint at Oxford university, where Murdoch "stood for the secretaryship of the Oxford Labour Club but was ruled ineligible because he openly campaigned for votes". But the book is less interested in his life story and business ascent than most Murdoch volumes, and clearer and more pacy as a result. Its subject is political leverage: how Murdoch got it, exercised it, got more of it.

McKnight, who is a professor of journalism at the University of New South Wales, and was a leftwing newspaper and TV reporter for decades before that, shows that Murdoch was surprisingly clumsy and erratic in his early politicking. In Australia and then in Britain, he hastily fell for and then rejected party leaders, changed his mind on policy questions, and swung from left to right and back again, or sometimes even in both directions at once. During the 1972 British miners' strike, Murdoch's Sun, as he later put it, "pushed public opinion very hard behind the miners"; almost simultaneously, in Australia, he was allegedly complaining to one of his editors about "long haired stuff in the paper … bleeding heart stuff … Aboriginal stuff … Aboriginals don't read our papers."

The usual interpretation of Murdoch's fickleness is as a skilful hedging of bets. During the 1980 US presidential election, Murdoch's New York Post, one of his loudest political megaphones, endorsed Jimmy Carter as the Democratic candidate in the New York primary, days after the two men had had lunch. "When asked by a friend how the Carter lunch had gone," McKnight writes, "Murdoch is said to have replied: 'Very good, but he is going to get a hell of a shock when I support Reagan [for president].'"

Murdoch has a weakness for self-styled national saviours, whether of the right like Reagan or the left like Gough Whitlam, Australia's iconoclastic Labour prime minister in the mid 70s. In 1967, Murdoch hired Whitlam's private secretary, John Menadue. In 1999, long after leaving the tycoon's service, Menadue wrote of Murdoch: "He was, and still is, a frustrated politician." On Australia Day in 1972, Murdoch made a speech identifying "the rebirth of a vigorous Australian nationalism, something that has lain dormant for most of this century – to the heavy detriment of Australia's progress and enlightenment." The social generalisations certainly suggest a would-be politician; the ponderous, slightly old-fashioned language possibly suggests why he never became one. The impatience and contempt with which Murdoch sometimes treats politicians may be rooted in frustration. He has never done a Berlusconi.

McKnight extracts most of his Murdoch quotes and facts from easily available sources: other Murdoch books, pieces in Murdoch newspapers, memoirs by former Murdoch underlings. Yet the portrait he builds feels fresh and strong, free of the usual biographers' ruminations on the Murdoch mystique and their love/hate feelings towards him. Sometimes the book is a little stark and skeletal as a result, a 260-page charge sheet, calmly but relentlessly laid out. Only occasionally does McKnight allow himself some descriptive colour, such as a Bond villain image of Murdoch in 2003 watching the invasion of Iraq, for which his papers had lobbied for almost a decade, "on the panel of seven television screens mounted in the wall of his Los Angeles office".

Murdoch moved decisively rightwards from the mid 70s, as the free-market revolution began to achieve critical mass across the west. He turned against Whitlam and Carter, and Labour and the unions in Britain. Significantly for British readers, and perhaps deflatingly for some British rightwingers, McKnight shows that radical American Republicanism had more influence on Murdoch than radical British Conservatism. From Richard Nixon's angry, embattled presidency, he took the notion that a "liberal elite" – rather than a rightwing business elite made up of people like Murdoch – dominated western democracies. From Reagan's much more successful political formula, Murdoch borrowed shrill anti-communism, a sometimes glib optimism about capitalism and a belief in America's right to world supremacy. In 1985 he became an American citizen.

His admiration for Margaret Thatcher was less total. According to McKnight, "Thatcher and Murdoch had a deep mutual regard, more sincere on her part than his." When she deviated from what he saw as the true path of modern conservatism, he could quickly turn critical or disloyal – despite her crucial support for his commercial expansions, such as his controversial takeover of the Times in 1981. In 1983, her lack of enthusiasm for the American invasion of the Caribbean island of Grenada, a tiny Commonwealth territory claimed by the Reagan administration to be a major, Soviet-aligned security threat, caused Murdoch to fume that she had "run out of puff", "gone out of her mind", and was not "listening to her friends". Even after Thatcher crushingly won her third general election in 1987, Murdoch flirted with other rightwingers: he gave what McKnight describes as "secret financial support" to David Hart, the late, well-connected British political adventurer, who used a column in the Times from 1983 to 1989 to call for such neoliberal dreams as the privatisation of all state education.

The book lays out well how Murdoch transmits his political desires, both within his conglomerate, News Corporation, and far beyond. The eerily consistent ideology of his newspapers and TV commentators is maintained in a lovely, menacing phrase quoted here from a former Murdoch editor, Eric Beecher, "by phone and by clone". Executives are chosen for their ability and willingness to anticipate Murdoch's thinking. On the rare occasions that more direct guidance is needed, "I give instructions to my editors all around the world," as Murdoch put it in 1982.

Meanwhile, a slightly more subtle political pressure is exerted on the outside world through cooperation between Murdoch media and rightwing think tanks, and through support for chosen candidates, which sometimes goes well beyond the journalistic. In 1980, McKnight writes, Murdoch backed Reagan's presidential bid by "meeting his aides to discuss maximising the Republican vote in traditionally Democratic New York. An important part of this was Murdoch's alliance with New York Democrat mayor Ed Koch … "

Frustratingly but probably wisely, McKnight offers no firm conclusion about the precise electoral impact of the Murdoch machine, such as the Sun's notorious assault on Neil Kinnock and Labour in 1992. But he points out that the machine's mere existence can drag policy debates to the right: even anti-Murdoch voters and politicians, and non-Murdoch journalists, are forced to take his positions and mindset into account.

Yet when his thinking grows too extreme or eccentric – the curse of many a little-challenged media magnate – his influence diminishes. In the late 80s Murdoch's dogmatic anti-communism made him totally misjudge the reformist Soviet premier Mikhail Gorbachev: "a worthy heir to Stalin", with "nothing new going on" in his policies, concluded a New York Post editorial in 1987. Reagan negotiated with Gorbachev regardless. For a time, post-cold war American politics seemed to baffle Murdoch, too. In the 1988 presidential election, he vainly favoured the erratic TV evangelist Pat Robertson as the Republican candidate. In the 1992 contest, he abandoned the Republicans for the independent Ross Perot, who came third. Even in Britain, in the 90s there were hints that the Murdoch era might be drawing to a close. Thatcher's successor, John Major, was increasingly appalled by Murdoch's commercial and political power and wanted to diminish it: "If I had a majority of 150," he said privately in 1995, "I would crush Rupert Murdoch and make sure he had no newspapers at all."

But Murdoch's vulnerable phase did not last long. In 1996 he launched Fox News, with its fiery round-the-clock readings of the conservative gospel, and his influence on American politics was reborn. In 1997 Tony Blair was elected, his government considerably less hostile to Murdoch than Major's, and Murdoch lent it strong, if conditional, support. In 2010, shortly after Murdoch had switched his allegiance back to the Tories, Blair became godfather to one of Murdoch's children.

For all the outward, often blatant signs of Murdoch's influence, there remains an opaqueness to his political role. Partly this is a sign of his status, and of the congruence between his thinking and that of so many western politicians during the long free market ascendancy from the 70s to the 00s. McKnight quotes the former Australian prime minister Paul Keating: "You can do deals with [Murdoch] without ever saying a deal is done."

But there is a deeper mystery about him. What sort of political animal is Murdoch really? A crafty player of the game for its own sake; a self-interested businessman simply seeking more corporate freedom; a restless seeker after heroes and ideological certainties; a chippy anglophobe; a rebel against an establishment father; or just a powerful, opinionated man surrounded by unquestioning courtiers, a little like Prince Charles? Murdoch is probably a bit of all these, and McKnight doesn't ever quite establish the respective proportions. But as an anatomy and record of the reign of Murdoch this book is brave and valuable. And one day, when Murdoch is gone, it will help explain why so many obeyed him.